A tax on currency transactions as an instrument in the war against poverty

This paper considers whether a tax on currency transactions could
be expected to raise a significant sum of money for use in the war on
poverty. It traces the detailed discussion of Kenen and the subsequent
argument of Schmidt, that technical developments would now permit the
tax to be levied efficiently by the five authorities who issue currencies in
which transactions are settled. It notes the creation of the CLS Bank and
the proposal to confine a currency transactions tax to transactions that
go through that bank, but argues that this would have dangers. It notes
also Spahn's proposal for a geographically limited tax, but argues that
this would not be advantageous if the aim is to raise revenue. The final
verdict is that a currency transactions tax of 1 basis point would be
feasible and could be expected to raise a sum of the order of US$ 20
billion per year.